BAE Systems fined £280m over corruption charge

BAE Systems will pay fines of £286 million to settle corruption charges with the Serious Fraud Office and US justice department.

The British defence giant pleaded guilty to two charges following an investigation into deals it won from countries including Tanzania, the Czech Republic, Romania and South Africa.

BAE will pay $400 million (£255.7 million) to the Department of Justice and £30 million to the SFO, the firm said.

The SFO said BAE would plead guilty in court to an offence of failing to keep "reasonably accurate accounting records" in its activities in Tanzania. Its payout to the SFO will be made as an "ex gratia payment" for the benefit of the people of Tanzania.

Richard Alderman, director of the SFO, said: "I am very pleased with the global outcome achieved collaboratively with the DoJ. This is a first and it brings a pragmatic end to a long-running and wide-ranging investigation."

BAE will plead guilty to one charge of conspiring to make false statements to the American government.

It said the settlement would allow it to "deal finally with significant legacy issues" which have overshadowed the company.

Chairman Dick Olver said: "In 2000, the company gave a commitment to the US government that it would establish and comply with defined US regulatory requirements within a certain period and it subsequently failed to honour this commitment or to disclose its shortcomings.

"In connection with the sale of a radar system by the company to Tanzania in 1999, the company made commission payments to a marketing adviser and failed to accurately record such payments in its accounting records."

He also said the company "failed to scrutinise these records adequately to ensure that they were reasonably accurate and permitted them to remain uncorrected". The firm added that, in the years since the incidents, the group had "systematically enhanced" its compliance policies and procedures.